March 2010 Up Front

News Analysis
Dialing for dollars: Budget emphasizes competition

Education is considered one of the big winners in President Obama’s new budget, but as Congress begins work on the vast spending plan amid spiraling deficits, school officials are casting a somewhat wary eye at the federal government’s increased focus on competition.

The $49.7 billion education budget, unveiled Feb. 1, represents a $3.5 million increase in discretionary funds. All but $500 million of those increases would go to programs covered under the Elementary and Secondary Education Act, currently known as the No Child Left Behind Act. The remainder would be used for the Investing in Innovation, or i3, fund.

Education Secretary Arne Duncan, addressing a crowd of representatives at NSBA’s Federal Relations Network Conference the day the budget was released, said the spending plan reflects Obama’s commitment to “two things: closing the achievement gap and raising the bar for all children.”

“At a time when other government expenditures are frozen, the president is increasing aid to education, because the president sees that education is the path to economic security,” Duncan told a crowd of almost 900 school board members on Feb. 1.

Duncan’s speech capped a hectic week of activity that included the president’s State of the Union address, the release of the budget, and the announcement of a roadmap for NCLB’s reauthorization. Educators generally embraced the moves, but raised concerns about the administration’s focus on performance pay, turnaround grants, and the Race to the Top program.

Anne L. Bryant, NSBA’s executive director, said the proposal is “a good start” for districts that have been forced to use stimulus funds to avoid even deeper cuts to staff and programs. She also praised the administration for “some true innovation and creative thinking” in the budget plan.

However, like others, Bryant said not including increases to Title I and the Individuals with Disabilities Education Act (IDEA) as part of the department’s regular funding could hurt low-wealth districts that have been hardest hit by the economic downturn.

“It does concern us that the administration is placing such a large focus on competitive grants. This emphasis on competitiveness could mean that rural districts and children in the poorest parts of the country will be left behind,” she said. “Those districts do not have the capacity to compete for grants unless you want to shift money from teachers to grant writers.”

Jack Jennings, president of the Center on Education Policy, said moving to a competition model is an attempt to make federal funding “conditional on districts’ taking action to improve schools.”

“Right now most federal money goes out in formulas, so schools know how much they’ll get, and then use it to provide services for poor children,” Jennings told the New York Times. “The department thinks that’s become too much of an entitlement. They want to upend that scheme by making states and districts pledge to take actions the administration considers reform, before they get the money.”

Duncan was quick to note in his speech that the Race to the Top funds are “new money” that will not take away from IDEA or Title I programs. “We’re not taking money from anybody to give to someone else,” he said during a question-and-answer session that followed with board members.

In a conference call with reporters before Duncan’s speech, the education secretary said states have created a “race to the bottom” in response to NCLB’s accountability requirements. The department’s proposal for the law’s reauthorization calls for eliminating the provision that all children must be “proficient” by 2014, and instead pledges to add $1 billion in competitive incentives.

“Race to the Top taught us that competition and incentives drive reform,” Duncan said during the conference call. “So even as we continue funding important formula programs like Title I and IDEA, we are adding money to competitive programs that are changing the landscape of our education system.”

Barbara Leak, a member of the Gary, Ind., school board, is concerned that Bryant is right on target. Moving money away from Title I and other programs and into “success” initiatives such as Race to the Top means her district will have to divert precious resources of its own as it chases the new funding.

For example, Leak said, her board is struggling to deal with a low-performing high school that it has been unable to turn around. Without additional federal dollars, that makes the job that much harder.

“We’re not going to be able to fully address the needs of that school without more money and help,” she said.

The lingering question is whether the Education Department’s budget request will remain intact once it maneuvers through Congress. Eduwonk blogger Andy Rotherham, who worked as an education advisor to President Bill Clinton, noted that the request could easily be rewritten.

“It’s a little unclear,” Rotherham wrote, “how this proposed $1 billion incentive fund for ESEA [Elementary and Secondary Education Act] reauthorization works since Congress, you know, controls the purse strings? They call it a budget ‘request’ for a reason.”

Glenn Cook, Editor-in-Chief

On The Hill
Another lap in the ‘Race’Michael A. Resnick

On Jan. 19, 40 states submitted applications to the U.S. Department of Education in the first of two competitions for a share of the $4.35 billion Race to the Top school reform program. On the same day, President Obama announced that he will ask Congress for an additional $1.35 billion to fund a third round this fall.

Details for round three still need to be developed, but Obama’s plan would include an opportunity for direct grants to local school districts that have attractive plans for raising student achievement and closing the achievement gap. These grants would be available even if the district’s state is not seeking or is not awarded Race to the Top funds.

Overall, the plan would stay on course with the administration’s four reform principles to:

• Upgrade standards and assessments to college and career-ready levels.

• Ensure that districts have effective teachers and principals, with an equitable distribution to schools in low- income areas.

• Utilize longitudinal data systems to mark student growth from year to year.

• Commit to turning around low-performing schools.

Critical policy questions from the first round of Race to the Top must be answered if it becomes a permanent program. And there are lessons to be learned.

Several states have changed their laws in significant ways, such as by lifting caps on the number of charter schools that can be authorized, in an effort to receive funds. This raises the question of how aggressively the U.S. Department of Education should pursue changes in state law to meet its reform goals. While not a direct mandate, the department’s approach significantly raises the federal government’s leverage to drive education policy, depending on how it is utilized in other programs to award formula or competitive grants.

We hope the department will clarify the selection process as it awards grants in the current round. Because competitive grants will be given to states that can serve as true models to the nation, the department likely will look more favorably on those that have made a larger commitment to education in the past and that can do so in the future. Therefore, as states use Race to the Top funds to accelerate student achievement, what will the department do to support those without the capacity to compete now?

As significant and hopefully beneficial as Race to the Top can be, it’s important to note that Congress has not weighed in yet. Normally, a federal education program with this policy impact and financial size would have much more detailed legislative guidance than was provided through last year’s enactment of the economic stimulus program.

In this regard, Congress has an important role to play in terms of its policy function and providing checks and balances on the executive branch, including representing the constituents who elected them. At the very least, Congress should conduct oversight hearings to determine the program’s effectiveness -- including identifying how school districts would like to see it improved. This will be especially important if the department wants to extend Race to the Top or include specific features in other major legislation such as the forthcoming reauthorization of the Elementary and Secondary Education Act.

Some locally based problems that arose with round one may not repeat themselves, but they underscore the need for federal programs to respect the realities local school districts face in building and supporting successful initiatives. In this first phase, many school districts were heavily pressured by their state to sign letters of commitment without ample time to think through the ramifications.

As a result, questions were left unanswered. Among them: What will it take to meet the requirements of the state’s plan? What are the long-term financial and operational impacts on the district? And, what union objections will we need to address?

We expect that some of these rough spots will be worked out down the road, but these kinds of problems could be avoided with adequate recognition of the local role. After all, it is where all education takes place.

Since the first lap of Race to the Top will fund only a handful of states, officials at the federal, state, and local levels should take the opportunity over the coming weeks to “go to school” on their own experiences. Everyone can learn from the “winner” states the best ways to address the application process for laps two and three. n

Michael A. Resnick (mresnick@nsba.org) is associate executive director of advocacy and issues management for the National School Boards Association. His column, “On the Hill,” appears monthly in ASBJ.

Talk About It
Our monthly list of topics worth discussing

Special education PTAsParents in Oldham County, Ky., have formed a special education PTA. The organization is the first in Kentucky; the number of such groups, designed to help address the needs of children with disabilities, is still small but growing nationally. The Oldham County parents joined together when the school board announced a redistricting plan that they felt would have hurt their children, according to the Louisville Courier-Journal. A special education PTA can offer parents of special-needs students more information and support than can regular PTA groups, Sandy Rutledge, president of Kentucky’s PTA, told the Courier-Journal. “When you have a child with special needs, you have to look at everything altogether differently, and it means a lot to know you’re not the first to go through it.”

Ohio pension changes
Districts across Ohio are dealing with increasing pension costs and want state officials to change the way the plans are funded. Like other states, Ohio has seen a significant downturn in its investments. One proposal by the state’s pension administrators would have both individuals and school districts contributing more to the plans. While teachers pay 10 cents into their retirement fund for every dollar they earn, the school district pays 14 cents. Under the plan, both teachers and their districts increase their pension contributions by 5 percentage points -- 2.5 more from teachers by 2016 and 2.5 more from the district by 2021, according to the Dayton Daily News. The proposal also calls for raising the retirement age for teachers.

New policy handbook upsets teachers
When Pasco County, Fla., school board members began work to revise their policy handbook -- which was more than three decades old and had many provisions that conflicted with current laws and technologies -- they set off a spirited debate between board members and teachers, according to the Tampa Tribune. Two major issues were provisions on running for political office and the section on “outside activities of staff.” In the end, the board approved a policy that says that “instructional staff members should avoid situations in which their personal interests, activities and associations conflict with the interests of the board,” according to the Tribune. While the language had been weakened from a previous version, some teachers objected because they were concerned it could interfere with their free speech rights. The board included a provision that requires employees who run for political office to give the superintendent “a written summary of their plans to conduct a campaign that will not interfere with fulfilling their obligations to the board.” Some employees were concerned that it meant having to detail their campaign strategies, but board members said it did not, according to the Tribune.

Hackers raid N.Y. district’s bank account
Computer hackers stole about $3 million from a rural New York school district’s bank account in December and deposited funds in overseas accounts. The FBI and state police recovered about $2.5 million of the funds belonging to the Duanesburg Central School District by January, according to the Albany Times-Union. The crime was discovered when the hackers sought to make a large electronic withdrawal. Cybersecurity experts told the Times-Union that schools must stay vigilant about checking accounts every day and put limits on wire transfers. Other cases have arisen because employees accidently downloaded malware or viruses onto district computers, which allowed cyberthieves access to passwords. “Sometimes we think it’s all about the technology, but it’s human controls not in place that would have found the exploits faster,” Doug Johnson, vice president of risk management policy at the Washington D.C.-based American Bankers Association, told the Times-Union.